3 Tips To Help Liz Lemon Reach Retirement

30 Rock and Roth?

Yesterday, before my favorite Thursday night NBC shows aired, I outlined this post. It was all about the lack of financial literacy in this country, most apparent in our youth, and how the education system isn’t doing much about it, etcetera, etcetera. But it didn’t get much further than that… Until 30 Rock came on, and, much to my roommates surprise, I whipped out my notebook and started writing down quotes. Here’s what went down:

Liz Lemon (Tina Fey) says something about how she wears Orange on Saint Patrick’s day to celebrate some obscure Protestant holiday (I wasn’t taking notes yet). Jack Donaghy (Alec Baldwin), has no problem with Saint Patrick’s Day, and in a typical, hilariously strange argument with Liz he adamantly defends the holiday, ending with:

JACK (condescending): “But you love Irish people, you once donated to the IRA!”

LIZ (exasperated): “I thought I was donating to a retirement account!”

Jack and Liz’s latest riff inspired me to expand my claim. Not only are young people under-informed when it comes to finance, but there are also plenty of adults who are clueless about some basic finance concepts, like retirement plans, even when they have them.

Blueleaf has your back, Jeff.

My second inspiration for this post, and the reason I started outlining it in the first place, comes from our friend Jeff Rose. Jeff polled a group of soon-to-be college graduates, asking if they knew what a Roth IRA was. The response? Zero. Zero percent of 21-year-old graduating seniors, ready to enter the workforce, knew anything about the Roth IRA. Jeff is now on a quest to change that, harnessing the power of bloggers to help raise awareness. Jeff wants to start a movement. If he’s successful, March 27th will be the day that We Humble Bloggers flood the internet with posts about how much we love the Roth IRA. And we do love the Roth IRA. So how do you teach personal finance?

The 3 Commandments of Teaching Finance

Let’s imagine finance is like cooking. Sure, the kids might learn how to make a cheese quesadilla in High School, but cheese quesadillas aren’t going to feed a kid for the rest of his/her life. No, the real cooking lessons have to come from home (or Grandma’s house), and not all parents are classically trained chefs, just as all parents are not finance whizzes. So it’s up to those who have the knowledge to share it. But, like cooking, finance can be very complex, and you can’t possibly teach them everything they need to know at once. That’s why it’s your duty to provide them with a base–just the fundamentals–to build on.

Thou shall maketh no assumptions

ASSUME = ASS + U + ME

Teaching a complex subject like finance to a complete beginner can be daunting. And when you work in the field, it’s hard to remember when you knew nothing. But it’s important to start from zero. Imagine you’re the student. It’s embarrassing for you to stop a teacher as they glide over a “basic” topic or term that you don’t understand. So the first rule in teaching finance is to make no assumptions. Start at square one with everyone you teach. It’s much easier to humbly inform your teacher that you know something already than it is to stop them, make them backtrack, and explain something, especially when the professor assumed it was something the student already knew.

Thou shalt abstain from jargon

JARGON = ONGRJA

There’s a reason that @DecodingWallSt has racked up almost 1,000 followers in just 6 months. Like many complex industries, the finance world is riddled with jargon. Ok, let’s be honest, finance pros use more jargon than most. The problem with “jargon” is obvious in it’s dictionary definition: unintelligible, barbarous, pretentious, convoluted, vague. This is exactly the opposite of how you should be teaching finance. Instead of talking about 401k’s and Roth IRA’s, just outline how retirement plans work. Talk about debt, investments, and credit–big picture stuff. The specifics will only stick when your student knows where they fit in the big picture.

Thou shall wait for the right moment

TIMING IS EVERYTHING

Here’s a thing: No matter how well intentioned you are, it’s really hard to understand something like retirement when you’re 15 and the only job you’ve ever held down was at the Snack Shack for a summer. School is your “job,” and that makes “real jobs” and all the financial ballyhoo that surrounds them totally abstract and impossible to imagine. There’s a right time and a wrong time for financial advice, and there’s no point in trying to force it. Teach the kid about taxes and saving when they’ve got the job at the Snack Shack. Teach them about loans and debt when they’re applying to colleges. Teach them about retirement and credit when they’re graduating college and looking for their first job.

Suit the lesson to the situation.

DJ is a freelance writer, hopeful photographer, and social media has-been. He writes to financial advisors about lifehacks, science, technology, business and marketing for Blueleaf, a software that helps create dramatically simpler, more scalable financial advisory businesses. You can find DJ across the web (about.me/djswitz) or you can just follow him on Twitter (@djswitz)!